Immigration New Zealand has paused its $336 million visa processing overhaul after finding that the savings it promised Cabinet were overstated by $134 million, RNZ reported on Monday.
The overstatement is more than a quarter of the $453 million in savings the Our Future Services programme was forecast to deliver. According to RNZ, a report to Cabinet shows both the productivity gains and the overhead savings from staff reductions were overstated. If the project now goes ahead as planned, it will cost more than it saves.
The Ministry of Business, Innovation and Employment, which runs Immigration New Zealand, has decided to pause the project and reconsider the strategic case for change and its key technology choices before more money is spent.
The new head of Immigration New Zealand, Andy Milne, was blunt about it when he spoke at the New Zealand Association for Migration and Investment’s annual immigration conference in Auckland on Friday.
“One of the questions I asked at our last OFS board was, how do we get those benefits so wrong? So even my new programme lead coming in has looked at it and said, look, if you were aiming for a 50 percent productivity uplift from a process improvement – that’s pretty much unheard of,” Milne said.
He said the business case had estimated overhead savings of about $50,000 for every full-time role that went. “But you don’t get those kind of overhead [cuts] as you reduce by fives and 10s. They’re usually sort of big organisational costs that are shared across the whole of the organisation.”
Milne also questioned how long the rollout was meant to take. “When I first read the business case, the thought that it was going to take us another seven or eight years to migrate all products onto Adept just seemed a staggeringly long time.”
Adept is the online visa processing platform Immigration New Zealand launched in 2022, and the programme’s aim was to move every visa type onto it and switch off the old systems. RNZ reported that the forecasts leaned on results from permanent resident visas, where automation on Adept let each immigration officer process 20 visas a day instead of five. But permanent residence is a simpler visa with a lower decline rate, handled by a small team at one site, so those results should not have been extrapolated across the whole system. The Cabinet paper says the $134 million in benefits is now unlikely to arrive “in the way, amount or timeframe assumed in the detailed business case”.
The February 2025 Cabinet paper that won the programme its approval, released by the ministry in 2025, spelled out where the $453 million would come from. The largest share, $344 million, was to come from needing fewer visa processing staff, mainly through attrition. Another $86 million was to come from shutting down old computer systems, $20 million from fewer calls to the Customer Service Centre and $3 million from lower postage and storage costs.
That paper was confident about the numbers. It said 35 percent of visa applications were already being processed on Adept, and presented that as proof the ministry could deliver and as a robust basis for estimating the benefits from real experience. It also said a conservative estimation approach had been used to make sure the benefits were achievable.
The savings were also meant to pay for most of the project. Of the $336 million cost, $229.8 million was to be funded by realising those savings and $106.4 million from immigration fees and levies, with no extra money needed from the Government. In other words, more than two thirds of the bill rested on savings that have now been cut by $134 million. A Cabinet committee minute from October 2024 recorded that total monetary benefits would exceed the costs from year four of the programme.
The 2025 paper did allow for things going wrong. It noted that if a significant event cut revenue and the expected savings could not be realised, there were gateways at the end of each phase where the programme could be stopped or scaled back. RNZ reported that the programme passed an independent quality assurance review and a Treasury review in 2024 before it was given the go-ahead.
Immigration Minister Erica Stanford said she and other ministers had also been kept in the dark about the programme’s progress, but she did not believe the benefits had been deliberately inflated.
“From what I understand, it’s a genuine error. I’m not sure that it was done to look better, but look, these are questions that need to be put to MBIE and probably to the chief executive,” Stanford said.
“Of course it’s disappointing that they haven’t got some of their figures right. But as I say, the most important thing now is that we stop, pause and do what we have done and make sure we are getting that right,” she said.
While the rethink goes on, the old technology the programme was meant to replace is still in use. When Cabinet first signed off the programme, it was told the ageing legacy platforms carried significant risk and high maintenance costs, estimated at $224 million over the next 13 years, according to RNZ.
The pause follows the collapse of the Biometric Capability Update, a separate project that ran for seven years and cost about $36 million before it was axed. It was meant to deliver an identity capability that Our Future Services relied on. Parliament’s privileges committee has since ruled that MPs were deliberately misled over its axing, as Newswire reported in August.
Our Future Services was already under outside scrutiny before the pause. On 19 August Public Service Commissioner Sir Brian Roche appointed David Hosking, who spent 34 years at Accenture as a quality assurance lead and assurance director, to lead an independent assurance review of the programme. Stanford asked for the review after the biometric project failed, and it will look at the programme’s cost, governance, management, reporting and delivery of expected benefits. It is separate from the inquiry led by Michael Heron KC into the conduct of officials linked to the biometric project.
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Should Immigration New Zealand press on with a smaller version of the project, or go back to the drawing board? Tell us what you think in the comments below.
This article was written by AI, briefed to report the facts, hopefully without some of the bias people bring to the job π
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